Mr. Vaz:
I am sorry that I cannot give way to the hon. Lady, because other hon. Members want to speak. The Liberal Democrat position is the right oneexcept on the tests. It is important that the tests should be met. The Liberal Democrat view that we should go ahead with a referendum without the proper economic case is wrong.

The Minister is right to talk about reform. I have not read his latest leaflet, which reduces the treaties to 300 words. It is a brilliant idea. It is exactly what we should be doing. Indeed, as there are so many Welshmen in the House today, I wondered whether they might want a Welsh translationI can think of a few other languages into which the leaflet might also be translated.

Some Opposition Members, in the hysteria of the tabloid press, are trying to turn the European issue into one of not only language but the complications of the European Union. It is important that we should explain those points and the arguments to the British people in simple language.

It is vital that we continue to push ahead with the reform agenda in Brussels. It is time that Brussels took off its burka. So much takes place in secrecy that people do not understand what is happening. I favour the televising of European Council meetings as an opportunity for people to see the good work that is being done by the Prime Minister, the Minister for Europe, the Foreign Secretary and other Ministers. It is important to raise the veils of secrecy.

I pay tribute to my hon. Friend the Member for South Shields (Mr. Miliband) for his work in the group of Laeken. It is essential that Britain is represented in that group by such an outstanding individual, ensuring that our agenda is discussed in Europe at the highest level.

Unless we reform those institutions and the way in which the EU operates, we shall not be able to make the case for the euro in a referendum and win. As I have said before, the people of Britain will learn to love the EU only when they learn to love reform. My right hon. Friend the Minister has spoken the language of reform today, so he has our wholehearted support on this issue, and I wish him well in the forthcoming European Council meeting.

8.45 pm

Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale):
I am pleased to follow the contribution of the hon. Member for Leicester, East (Mr. Vaz), not least

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because he has restored some of the balance to a debate that has been going one way for a prolonged period. The Liberal Democrats broadly support what the Government seek to achieve on Europe, and we hope that they will continue to promote progress in reforming and developing the EU at the summit in Laeken next weekend.

We are disappointed with the Government about one major issuethe single currency, to which the hon. Member for Leicester, East has just referred. Despite the Government's bold assertions in arguing the case, to which he referred, we believe that their approach is characterised by timidity and a lack of unanimity, so a rather confused message is coming across. Outside the environs of Westminster, few people could say with any clarity where the Government are going.

Of course, in a few short weeks, the single currency will be a reality in the shops of Amsterdam anddare I sayprobably in some shops in the United Kingdom as well, and the transactions of Britain's exporters will be very much embedded in the process, too. Finally, the bogeyman of the single European currency will be put to rest, with the realisation that the single currency works across Europe and that the sky does not fall in as a consequence of its use.

The Government's approach to persuading the British public about the merits of the European single currency continue to dismay its friends and encourage its enemies. It takes a massive leap of faith to find any unity throughout the recent speeches of the Prime Minister, the Chancellor and Foreign Office Ministers. The Government need a clarity of purpose, or at least a consistency of spin. It is not enough simply to send the spin doctors out to tell the journalists what the speeches meant. Positive steps need to be taken to argue the case and prepare the country for the full reality.

Only when we get the conditions correct for entry can we possibly hope to win a referendum; it cannot possibly be won in six weeks of campaigning. We need a sustained programme of education and persuasion, and we need a sustained Government voice. The Government will witness some of the details being finalised at Laeken in a few days' time, so they must substantially increase their efforts to promote and prepare this country for what we believe to be an important development for us.

Of course, the main aim of the summit will be to put in place the mechanisms to assist the debate on EU reform and the preparations for the 2004 intergovernmental conference. We Liberal Democrats hope that the intergovernmental conference will be able to produce a constitution for Europe. We do not hide from that, as the hon. Member for Wimbledon (Roger Casale) suggested that those on the Conservative Front Bench do, and they ducked dealing with their fears on that issue.

A constitution is important simply to set out clearly the roles and responsibilities of the different EU institutions, to define more clearly their relationship with individual member states and to prescribe the rights of individual citizens, by incorporating the charter of fundamental rights in that constitution. In that way, we can begin to address the huge concerns that people have about the progress of Europe and the growing disillusionment that dismays those of us who support Europe.

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The convention to be set up by the summit is crucial to the process and, in due course, to the outcome of the intergovernmental conference. If the convention is to be meaningful, its terms of reference must not be too restrictive and it must not prepare for a set outcome. If the debate is to be effective, it must be structured but not prescriptive.

The European Scrutiny Committee report on the issue makes important recommendations. The convention should focus on the four key points coming out of the Nice treaty, but it should be free to consider other matters as well. It should be required to give an indication of the particular option that it prefers while not ruling out the others that it has considered. In addition, a House of Commons Member should be appointed to it by a motion of the whole House and not as the result of a stitch-up by the Whips. When appointed, that person should be required and given the opportunity to report back to the House on the convention's progress.

One key point from Nice has become increasingly evident. Whatever we are doing, we must make Europe better understood. The treaties need to be simplified into something that approximates to language that we can all understand and about which we can hope to persuade others.

Among the other issues, I wish to refer particularly to European security and defence policy. Much has been made of the transformation of the world since 11 September. Some aspects of the common foreign and security policy work well, but others require improvement. The policy covers 15 member states, with a population of approximately 370 million. After accession of applicant states, the population will increase to more than 500 million.

European Union states spend about 150 billion euros each year on their military capabilities. That is about half the United States defence budget, although it recognises that there are more limited regional responsibilities. The EU population is 40 per cent. larger than that of the USA, but the gross domestic products of the two regional blocs are roughly the same.

It is inconceivable to us that such a rich and populous region as ours should not make greater provision for its collective security. As the Minister said, now that the arrangements with Turkey over access to NATO assets are moving in the right direction, we are making progress towards achieving the European capability that we need. One by one the difficulties are being overcome. Over the past few months, there has been much rhetoric about standing shoulder to shoulder, but if that is to mean anything, we must be prepared to shoulder the burden of providing for our own security.

The final issue that I want to consider briefly is the EU arrest warrant. Its purpose is straightforward and appealing enough, not least in that it is designed to remove the complexity and potential for delay that is inherent in the present arrangements for extradition which, through bilateral agreements between countries, are often complex. It is logical and desirable to replace that system with a common EU framework. Current procedures are clearly out of date, they are complex and require rationalisation.

However, we are concerned about the breadth of the warrant that has been proposed and, not least, by the fact that the definitions in it are extremely vague. The general

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headings include "high-tech crime", "environmental crime" and "racism and xenophobia". Three times the proposal has come before the European Scrutiny Committee and it is still not satisfied with the Government's definitions. We understand that the proposal will not be included in the Anti-terrorism, Crime and Security Bill, but will appear in primary legislation next year. However, the agreements at Laeken in 10 days' time with other EU member states will be reflected in the legislation. As the House has not proved itself satisfied with the proposals as explained by the Government, we believe that it would be better not to sign up to the warrant at the summit. By delaying its acceptance until national Parliaments are happy with it, a better arrangement will come to the fore.

After the euro is introduced in January, the face of Europe will change significantly. In a recent speech to academics and business men in Birmingham, the Prime Minister said:

"The tragedy for British politics and for Britain is that too many politicians have consistently failed, not just in the 1950s but up to the present day, to appreciate the reality of European integration and in so doing they have failed Britain's interests".

Whether the Prime Minister was talking about the single currency or the agenda for reform and progress, he must not forget those words when he goes to Laeken.